Mr. Doug Vickerson reports

RENOWORKS ANNOUNCES ANNUAL AND RECORD FOURTH QUARTER 2023 FINANCIAL RESULTS AND PROVIDES OUTLOOK

Renoworks Software Inc. has released its financial results for the year ended Dec. 31, 2023. The financial statements, and related management's discussion and analysis (MD&A), can be viewed on SEDAR+.

Financial highlights for the fiscal year 2023, with comparatives for 2022, are as follows:

• Annual revenues of $6,292,601, a slight increase from the prior year's $5,941,830;
• Deferred revenue of $1,633,394 at Dec. 31, 2023, compared with $1,413,786 at Dec. 31, 2022;
• Recurring revenue of $2,251,019 versus $1,869,674 for the same period in 2023, a 20-per-cent increase;
• Gross margin of 70 per cent versus 64 per cent in 2022;
• Net loss of $497,771 compared with a net loss of $1,320,786 in 2022, an improvement attributed primarily to the rise in licensing and hosting revenue of 20 per cent, and reductions in operational expenditures;
• Cash at Dec. 30, 2023, was $645,549, down $58,531 from $704,080 at the end of fiscal 2022;
• The company's working capital at Dec. 31, 2023, was negative $228,357 compared with a positive working capital of $207,163 at Dec. 31, 2022, a decrease of $435,520 primarily due to an increase in deferred revenue balances of $240,515. Excluding deferred revenue, a significant non-cash item included in working capital, the company's working capital at Dec. 31, 2023, is positive $1,264,069 ($1,459,074 -- Dec 31, 2022);
• As at Dec. 31, 2023, the company had 40,664,635 common shares issued and outstanding.

Financial highlights for the fourth quarter of fiscal 2023, with comparatives for 2022, are as follows:

• Quarterly revenue of $1,503,032 for the three months ended Dec. 31, 2023, versus $1,201,509 in 2022;
• Recurring revenue of $618,534 versus $473,155 for the same period in 2023, a 31-per-cent increase;
• Gross margins continue to be strong at 66 per cent and 62 per cent, respectively, for the fourth quarters of 2023 and 2022;
• Net loss of $211,734 for the quarter ended Dec. 31, 2023, compared with a net loss of $705,601 in 2022.

Renoworks reported a total revenue of $6,292,601 for the year ending Dec. 31, 2023, marking a 6-per-cent increase of $350,771 from the previous year's $5,941,830. This increase was primarily fueled by a 20-per-cent rise in licensing and hosting revenue, reflecting the company's strategic advancement of its visualization solutions adoption within the remodel industry.

The decrease in net loss for 2023 as compared with 2022 is primarily due to these increased revenues and improvements to operational efficiencies, which includes gains through reduced selling, general administrative costs, and research and development expenses.

"Our financial results are a direct outcome of our focused investments in AI [artificial intelligence]-driven solutions, partner integrations, Renoworks Pro through key partnerships and resource management," explained Doug Vickerson, chief executive officer of Renoworks. "These initiatives are helping to drive the adoption of our platform and brand awareness across the industry."

For the fourth quarter ended Dec. 31, 2023, Renoworks' adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) was a negative $189,211, showing significant improvement with a rise of $461,836 from the previous year's negative $651,047. This upward shift underscores the company's continuous strides toward enhancing platform functionality and operational efficiency.

Investments in technology and strategic initiatives remained high, as Renoworks continued to develop its contractor software platform and expand its AI Gen2.0, data science and analytics capabilities. These efforts aim to bolster the company's product offerings and market position.

Financial results from operations year to date, with comparatives for 2022, are as shown in the associated table.

Financial results from operations for the fourth quarter 2023, with comparatives for 2022, are as shown in the associated table.

About Renoworks Software Inc.

Renoworks Software develops and sells unique digital visualization software and integration solutions for the remodelling and new-home construction industry. Renoworks delivers its technology to manufacturers, contractors, builders and retailers offering solutions to one of the home improvement industry's greatest challenges: enabling homeowners to review their product selections in a hyperrealistic, virtual environment before committing to purchases and construction. Renoworks markets its technologies as an innovative engagement, sales and marketing platform, and generates revenues from five main business lines: Renoworks Enterprise, Renoworks Pro, Renoworks Design Services, Renoworks FastTrack and Renoworks API (application programming interface).

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